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The Price of Freedom

By Brian P. Watson Print this article Print

Call it the democratization of software. But in this election contest, open-source operating systems come down to two leading candidates with similar platforms.

Companies looking to escape the shackles of proprietary operating systems often share the same motivations. Why break the chains? Customers point to two driving factors: cutting license costs and avoiding vendor lock-in.

Instead of using proprietary, closed-source platforms, organizations can move to open-source operating systems. Open source refers to software whose underlying code is available to anyone, free of charge. Thousands of contributors most notably Linus Torvalds chipped in to create the Linux kernel, the core of the Unix-like operating system, in 1991.

Since then, organizations large and small have made Linux their platform of choice. And vendors have been reaping more and more revenue in recent years: in a February 2007 report, Gartner Dataquest found that the compound annual growth rate of open-source software (43%) between 2006 and 2011 will more than quintuple that of proprietary software (8%). The firm projects open-source software sales to reach $4.23 billion in 2007, swelling to $13.10 billion in 2010.

So, who benefits from this growing shift? To date, two organizations have truly commercialized open-source platforms: Red Hat, which released its first enterprise product in 2002; and Novell, which acquired the popular SUSE Linux distribution in January 2004. More than 90% of the open-source deployments in enterprises involve one of those two companies, industry analysts say.

During the dot-com bust, outdoor gear retailer Backcountry.com shied away from proprietary products with closed code, according to chieftechnology officer Dave Jenkins.

In that turbulent business environment, Backcountry.com didn't want to spend thousands of dollars for software from a vendor that could go under the next day. "Whatever we go with, we need to have the code," Jenkins says.

Before joining Backcountry in April 2005, Jenkins was the consultant for Red Hat, the leading enterprise Linux vendor, who helped his new employer migrate to Linux. Backcountry currently runs Red Hat Enterprise Linux 5 on 60 to 70 servers, depending on the season.

Jenkins says his company saves between $2 million and $3 million a year by avoiding the license fees for a proprietary platform like Microsoft Windows. With those savings, Jenkins says his team questions whether or not they should invest in some closed-source products. "So, should we start cutting checks? Invariably, I come back to saying no," Jenkins explains. "With the cash we have on hand, would we rather go back to our gear vendors to buy more goods to sell online? Yes."

Next page: Cost Concern

This article was originally published on 2007-05-14
Associate Editor

Brian joined Baseline in March 2006. In addition to previous stints at Inter@ctive Week and The Net Economy, he's written for The News-Press in Fort Myers, Fla., as well as The Sunday Tribune in Dublin, Ireland. Brian has a B.A. from Bucknell University and a master's degree from Northwestern University's Medill School of Journalism.

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